On Sandy anniversary, Knickerbocker tenants still waiting for rebate checks

BY SAM SPOKONY | A year after Hurricane Sandy struck, residents of Knickerbocker Village, a Lower East Side affordable housing complex, are still
waiting for the rent rebates they were promised by the development’s management.

Last November, after tenants of the 12-building, 1,600-unit complex spent weeks without electricity or hot water, a representative of AREA Property Partners, the management company, said they would ensure that “not a penny of rent will be paid for the days on which [residents] didn’t have essential services.”

But this week, management confirmed that none of that money has yet been paid out.

“We’re still trying to make it happen,” Edwin Maltzman, the building’s controller, said in a phone interview.

Knickerbocker Village is a Mitchell-Lama development, so although it is run and maintained by AREA, its cash flow is controlled by the state’s Division of Housing and Community Renewal.

Maltzman said that management has been working alongside D.H.C.R. in an attempt to fund rent rebates through insurance claims, but acknowledged that it’s still a work in progress.

Meanwhile, Bob Wilson, a longtime tenant leader who has lived at Knickerbocker since the 1940s, said that he believes the fight for rent rebates was unfeasible from the very beginning.

Typically when D.H.C.R. approves rent rebates for a Mitchell-Lama complex, those deductions must be balanced out later by rent increases in order to balance the development’s cash flow. If that ends up being the case at Knickerbocker, the process would be self-defeating.

“That’s the whole problem,” said Wilson. “They haven’t gotten the insurance companies to cover it, and if they can’t do that, then the money for rebates would eventually have to come out of the pockets of tenants.”

Wilson added that he and other tenant leaders have tried to explain this to other residents who were clamoring for the rebates, but said that it’s simply difficult to educate them through weekly meetings, and that therefore many still don’t fully understand the process. He believes that management should reach out to residents in order to explain the cash flow situation, and the difficulty of securing effective rent rebates.

“[Management] would be helping themselves out if they did that,” said Wilson, “because right now, every time they walk outside, there are residents demanding the rebates.”

But even amid all the technical difficulties, the elected officials who joined last year to push for the rebates — including Assembly Speaker Sheldon Silver, Councilmember Margaret Chin, State Senator Daniel Squadron and Borough President Scott Stringer — are still
pushing equally hard to make sure that any rebates are not paid for through later rent increases.

“The residents of Knickerbocker Village should not be charged rent for the weeks they endured in their homes without essential services,” Chin said in a statement to Downtown Express Tuesday, the anniversary of Sandy. “I encourage management companies to do the right thing and honor their commitment to provide rent abatements for the residents who went without — without forcing
tenants to shoulder the costs.”

In a statement also released Tuesday, Silver alluded to allocations of federal funding for building repairs, while also driving the same point home regarding rebates.

“Since the storm struck, I have made it a top priority to work with the city to ensure that Knickerbocker receives the resources it needs to repair and rebuild,” Silver said in his statement on Tuesday. “I also secured a promise from the owner of Knickerbocker that tenants would receive rent rebates for the time they were without essential services and that the cost of those rebates would not be passed on to the tenants. I expect that promise to be kept.”

But Maltzman’s response was, at best, tentative when asked if he believes it will actually be possible to fund rebates without eventual rent increases.

“We’ll have to see about that,” he said.
In other news regarding the development’s post-Sandy recovery, sources said that the city’s Department of Housing Preservation and Development will announce on Wednesday that Knickerbocker Village is now going to receive some of that much-needed cash for building repairs. That money — which is entirely separate from the issue of rent rebates — will be taken from federal funding and specifically allocated through the City’s Build it Back initiative.

Jim Simmons of AREA Property Management last year promising Knickerbocker Village tenants rent rebates for days of lost service as result of Hurricane Sandy. At left, looking on are State Sen. Daniel Squadron and Assembly Speaker Sheldon Silver. Downtown Express file photo by Sam Spokony.

One Response to On Sandy anniversary, Knickerbocker tenants still waiting for rebate checks

Where is Governor Cuomo's efforts here regarding the insurance companies? Or does he only sign tax rebates when the Legislature has closed and Extel et al get their windfalls? Insurance companies are ripping off many affected by Sandy and the citizens need a champion in the Governor's mansion FOR THE PEOPLE.